In November 2018, targeting the festive season, Fourpost opened its “microstores” or “Studio Shops” and eateries at the Mall of America (Bloomington, Minnesota) and the West Edmonton Mall (Alberta, Canada). This concept store space in the Mall of America extends across 10,000+ square feet, while its Canadian counterpart covers 5,000+ square feet.
Coincidentally, the retail concept founded by CEO Mark Ghermezian also raised $5M from Susa Ventures, Collaborative Ventures, Blumberg Capital, T5 Capital, Accelerator Ventures, Social Capital and Hersz Capital according to a press note.
Considered “the Shopify of physical retail” and sometimes described as “a little bit WeWork and a little bit high-end food court”, Fourpost allows brands to lease uniform studio shops at prime real estate locations. Up to 30 of these Studio Shops are set in one storefront, much like a traditional department store.
Brick and Mortar Upgraded
“Today, brands are demanding better options for brick-and-mortar,” said Ghermezian. “The industry has not kept pace with modern retail. We built Fourpost to completely re-architect the process by building a community and breathing fresh air into what has been a stale industry between landlords and brands for hundreds of years.”
So, Fourpost provides retailers with a ready-to-use (turnkey) brick and mortar microstore without having to worry about long-term leases, high rents, capital expenditures and operational logistics. It principally relies on a time-tested model which has worked really well for the likes of Airbnb and Uber. The idea is to section an asset ‘into smaller assets that can be bought and resold with greater frequency’, as described in a Forbes article. This provides the required retail solution at a much cheaper rate, thus unlocking more value.
It also seeks to make the mall experience fun for consumers again. Apart from the unique, diverse and frequently changing brands within the Fourpost space it, “.. aims to have events going on within the store every day,” said Kathleen Waugh, Senior Director of Marketing for Fourpost. One of the Fourpost venues even had entertainment options such as a live DJ onsite, a popcorn machine, and a doughnut selfie wall.
They have also started offering staffing which is a great add-on service. “So when brands come on not only are they getting their turnkey spaces with us . . . but we’re also providing full staff so it’s completely turnkey,” Ghermezian said.
More Than Just a Pop-up Store
But Fourpost is not just a pop-up store. It is much more. It is able to create a much more elevated experience by allowing businesses to opt for short (six and 12-month long) leases or memberships, for somewhere between $2800 and $3200 per month. This lets member brands experiment with the physical retail concept, in a customizable and strategically located space.
It also offers access to retail-boosting physical and technical tools. Member-only business management tools, on an easy-to-use SaaS dashboard, range from retail merchandizing guidance, staffing support, calendars, billing, event booking, social media, seminars on entrepreneurship and brand building. It also helps analyze storefront data to gain useful insights that could potentially grow their businesses. Additionally, clients of Fourpost gain access to fixtures, Wi-Fi, lighting, signage, and point-of-sale hardware.
“We want to democratize the traditional department store experience and inject new energy into physical retail,” Ghermezian said. “We built Fourpost to completely re-architect the process in what has been a stale industry between landlords and brands for hundreds of years.”
Another unique aspect of Fourpost is the fact that the stores do not need to stick to being boring squares (literally and figuratively). Member brands can pick from rectangular or triangular shape too. This gives brands a chance to work more creatively with their allocated areas’ size and shape. What’s more, the average SME can open a Studio Shop within 24 hours. All that brands need to do is place their goods on the shelves. Mostly only the trial pieces are in the store, while the complete stock is shipped by the business whenever a purchase is made.
“By giving emerging businesses access to a high-visibility platform,” he said to Minnesota Monthly, “we hope to become a destination that supports local commerce, allows businesses to learn from each other, and keeps shoppers coming back for more.”
That’s not all. Built to lower the barrier of entry for emerging brands and e-commerce pure-plays, Fourpost hopes to give the turnkey-retail space a “local flavor” albeit with national and international brands. Still Kickin’ Julia Knight Collection, and Baubles and Bobbies are some of the Minnesota-based Fourpost clients. At the same time, it is also leasing space to brands such as Printworks – a Swedish gift and accessory brand. It has also signed on legacy consumer electronics brand – Polaroid.
In conversation with Twin Cities Business Ghermezian said, “We’ll always have local flavor. The local community is important to us. Our guests will always find their favorite local brands, but also discover new international brands, digitally native brands and in some cases, smaller or larger national brands.”
Currently, the Mall of America Fourpost space has 22 local and international companies as members. The West Edmonton Mall, similarly, has 16.
The Story Behind Fourpost
The idea for Fourpost came to Ghermezian while he was still invested in his last venture, Braze, a subscription-based SaaS company that provides one-on-one customer engagement tools. Braze, helped brands move to mobile customer service leaving incumbent services behind in the dust. “I saw an opportunity to apply the same model to brick and mortar retail, an industry ripe for disruption, and Fourpost was born,” said Ghermezian in a blog post.
It started off as a holiday pop up store, in October 2017, at Mall of America’s Minnesota Marketplace. Soon after, Retail As A Service (RAAS) was incubated by T5 Capital, Triple Five’s venture capital firm. Then it January 2018, it officially evolved into the tech-savvy 2.0 version – Fourpost.
While beta testing the original concept, Ghermezian was intent on knowing whether brands really see a need for turnkey spaces (in prime locations) that come packaged with community and technology.
“Through that process, we also got a better understanding of what our purpose is and what we’re doing as a brand and we really put a lot of thought into who we are, and what we are, and what we want to be,” said Ghermezian.
He claims that the etymology of Fourpost comes from their innate desire to provide the ‘four posts of innovation for retail’ – a community of local, emerging and e-commerce brands; leasing out of space which is dependant on shape and not square feet; technology and customer experience-based services; and curated high quality business services.
He also believes that what makes Fourpost bigger than just any Retail-as-a-Service, is its strong community angle. Fourpost empowers retailers to form a community that is built on positive engagement in the form of sharing information and asking questions.
Future of Fourpost
It is believed that physical retail isn’t dead, but boring retail is. As mall space across the US increasingly goes vacant, the disruptive Fourpost model might just be the way to get shoppers and small businesses back into malls.
In fact, the retail fixtures industry are expected to reach $7.8Bn in 2020, according to information from Statista and the U.S. Census Bureau. Apart from Fourpost, we have brands such as by REVEAL, a full service portable pop-up solution with RFID tagging and metrics and WithMe’s turnkey pop-up solutions that come with digital catalogues, magic dressing room mirrors, smart vending systems and e-commerce.
Since the market has been long waiting for such a disruptive retail solution, Ghermezian says he isn’t worried about attracting new tenants after the holiday season. In fact, he has already received interest for spots starting in February 2019. But there’s no question that the smaller brands, at least, are focused on the season at hand.
While Fourpost has started with leasing out space at shopping malls, it plans to eventually move on to standalone street retail spaces such as open-air centers and street-level stores. “Malls are relevant in some markets, but not in others. We’re going to do what best serves the brands and guests,” he said to DIGIDAY.
To that end, Fourpost plans on expanding its footprint to at least 10-20 locations across the US. Secondary markets such as Austin, Nashville and Boston will most likely be targeted, as opposed to experiential store-heavy New York City and Los Angeles.
“We have to be thoughtful about where we go next,” Ghermezian said to Commercial Property Executive. “Each market will be looked at independently.”
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